U.S. appeals court allows Trump casino to break pact with unions

Donald Trump, the Republican presidential candidate and celebrity real estate developer, has said he no longer has a stake in the company he founded and which still bears his name.

In 2014 Trump Entertainment Resorts Inc filed for bankruptcy and last year it convinced a U.S. bankruptcy judge that it had to impose a new lower-cost contract on unionized workers in order to secure a rescue deal with billionaire Carl Icahn.

The union, Unite Here Local 54, appealed. It argued that because the collective bargaining agreement, or CBA, expired before Trump entered bankruptcy, the U.S. Bankruptcy Court lacked jurisdiction.

In Friday's ruling, a three-judge panel of the 3rd U.S. Circuit Court of Appeals in Philadelphia sided with Trump Entertainment, saying a bankruptcy judge must be free to evaluate a labor contract that may determine the fate of a business.

"Under the policies of bankruptcy law, it is preferable to preserve jobs through a rejection of a CBA, as opposed to losing the positions permanently by requiring the debtor to comply with the continuing obligations set out by the CBA," Judge Jane Roth wrote in a 30-page opinion.

Trump Entertainment's Taj Mahal was the city's largest casino when it opened in 1990 and employed about 3,000 people when the casino group filed for bankruptcy, of which around 1,500 were union members.

The company said in court documents that defeating the union's appeal was a condition to exiting U.S. bankruptcy protection.